Government refuses to budge on out-of-pocket limits for family plans

The government is attempting to clarify a final rule published in February that, among other things, prohibited insurers from requiring families to pay more in out-of-pocket costs than individuals. HHS and the Departments of the Treasury and Labor sent a letter to groups representing employers in an effort to clarify that insurers cannot penalize consumers from choosing family coverage. The rule only applies to the category of essential health benefits (EHB) under the Patient Protection and Affordable Care Act (ACA). This category includes well-child checkups, prenatal care, mental health services, hospitalization, and prescriptions.

Rule. The final rule covered a wide range of issues related to eligibility, enrollment, affordability, and accessibility. Some of the provisions included the time frame for ending pediatric benefits, the requirement of using a committee system to design formularies, and requirements for minimum value standards. Some employers had offered plans that did not include substantial coverage of inpatient hospital and physician services in order to save money, but these plans circumvented the purpose of the minimum value standards requirements.

Out-of-pocket costs. According to the departmental letter, each family member under the family plan will have an out-of-pocket cap of $6,850. A family cap of $13,700 would apply if multiple family members submit claims. Individual copays, coinsurance, and deductibles count toward this amount. Once it is met, the insurance company is responsible for the remaining costs. Business groups are concerned that this rule will harm group health plans and result in increased premiums, especially for employers that offer high-deductible plans. The rule goes into effect January 1, 2016.